Paul Latham was a British drug smuggler. He and his best friend Mark allowed themselves to be talked into doing a dope run across the Atlantic by their mutual friend Alex Rinaldo. They used Mark's father's yacht. But when the yacht sank thanks to Mark, Paul and the others found themselves stranded in a life raft. They were adrift in the ocean for several days, having foregone sending an S.O.S. for fear of their rescuers learning they were smuggling dope. They found what seemed like salvation when they stumbled across an oil rig, and a crane hoisted them out of the sea.
However, they found the rig deserted. There wasn't even anyone in the driver's cab of the crane that had rescued them. They found only empty clothes and discarded, unfired weapons. Exploring the rig's interior, the group discovered it was owned by the Brinkstone Oil Company and that it was a front for some kind of secret genetics research lab. That night, as Paul slept in a room with his girlfriend Linda Warner, something tried to break in. Paul drove it away with his M16. Pursuing the strange creature, they encounter a scientist, Dr. Gordon Shelley, who explained to them that the beast was "Charlie." He promised to explain more later, but disappeared. The following day, Paul and the others discovered the radio sabotaged and the rig's compliment of speedboats smashed. A further encounter with another scientist, Dr. Carol Soames, yielded much of the same results as their encounter with Dr. Shelley had.
It wasn't until a third apparent survivor, Ed Buckley, turned into Charlie that Paul and his friends realized the horrible truth of where the people on the rig had gone, and what the Brinkstone scientists had been doing. Paul and Mark investigated research tapes made by Shelley and learned all about the Phoenix Project and the scientists' efforts to turn a great white shark named Charlie into the ultimate survivor using the Phoenix unit.
Charlie in the meantime took Alex's girlfriend Rochelle, Alex himself and finally Mark's girlfriend Chris, leaving only Paul, Linda and Mark, who Paul discovered was a heroin addict. Efforts to kill Charlie with guns and fire failed. It was only when Charlie killed and partially absorbed Mark while he was high that Paul and Linda discovered a means of subduing the creature. The injected Charlie with heroin over and over until it seemed to die. After this, they decided to try and escape, and encountered a Brinkstone helicopter pilot, who Paul reflexively shot and killed, thinking he was the creature. Discovering there were two pilots, they found the second one and forced him to fly them away from the rig after gathering Shelley's tapes as evidence of the Phoenix Project.
During the flight, the pilot revealed himself as Charlie, having taken over the pilot. Charlie attempted to inject Paul and Linda with its genes, to turn them into clones of itself. Thinking quickly, Linda offered Charlie the remaining vials of heroin, as the monster was now addicted to the drug. When it grabbed for them, Paul opened the door and knocked Charlie out out the helicopter and into the sea, unfortunately losing Shelley's tapes in the process. Climbing into the pilot's seat, Paul was able to safely fly himself and Linda to another Brinkstone rig. Although they were rescued, they worried about what would happen now that no one would believe their story.